New Home Buying and Building FAQs

With rising rental costs in Raleigh (average $1,400-$1,800 for apartments), buying often makes financial sense if you plan to stay 3+ years. Consider your job stability, lifestyle preferences, and long-term financial goals. The Triangle's strong economic fundamentals generally support homeownership as a wealth-building strategy. See here to learn more about whether you should rent or buy in Raleigh!

Spring (March-May) offers the most inventory but also the most competition. Fall (September-November) can provide better deals with less competition. Winter months may have fewer options but motivated sellers. In Raleigh's climate, you can house hunt year-round without weather being a major factor.

Beyond your down payment and closing costs, maintain 3-6 months of expenses in emergency savings. New homeowners should also budget $1,000-$3,000 for immediate needs like utilities setup, minor repairs, and basic furnishings.

Conventional loans typically require 620+ credit scores for the best rates. FHA loans accept scores as low as 580 with 3.5% down, or 500 with 10% down. Local credit unions and community banks sometimes offer more flexible programs for borrowers with unique situations. Read the full article here.

Before you begin shopping for new homes for sale in Raleigh, learn how much you can realistically qualify to borrow. The process is called “mortgage pre-approval”. Always get pre-approved, not just pre-qualified. Neither the pre-approval nor the pre-qualification is a guarantee of a loan, but the pre-approval is more reliable.

Mortgage pre-approval is a simple step. It involves a lender’s review of your financial situation, including income, bank accounts, debt, and job security (e.g., how long you’ve been at your current and previous jobs). After this review, you’ll receive a conditional commitment (in the form of a letter) for a specific loan amount. In Raleigh's competitive market, sellers strongly prefer pre-approved buyers and may not consider offers without pre-approval letters.

Local lenders often provide faster service, better communication, and deeper understanding of North Carolina regulations and local market conditions. They may also offer portfolio loans or special programs not available through national lenders. However, always compare rates and terms from multiple sources.

Start with online platforms like MLS listings, Realtor.com, and Zillow, but work with a local real estate agent for access to new listings and market insights. Agents can set up automatic searches and provide immediate notification of new properties matching your criteria.

The search timeline varies by market conditions and your specific needs. In competitive markets, be prepared to act quickly on the right property. However, don't rush major decisions. Most buyers look for 8-12 weeks, but some find their home immediately while others search for months.

Look for signs of water damage, foundation issues, outdated electrical systems, old HVAC equipment, and deferred maintenance. In older Raleigh homes, check for knob-and-tube wiring, asbestos, and lead paint. Pay attention to neighborhood conditions and any signs of decline or over-improvement.

Consider location factors like schools, commute access, and neighborhood trends. Look for homes with broad appeal, functional layouts, and the right size for the area. Avoid highly personalized features that might not appeal to future buyers. Research recent sales of similar homes in the neighborhood.

Work with your agent to analyze recent sales of comparable homes, current market conditions, and the specific property's condition and features. In competitive situations, you may need to offer at or above asking price. Consider the total package, including terms and contingencies, not just price.

Standard contingencies include financing, appraisal, and inspection. In North Carolina, the due diligence period allows you to conduct inspections and research. The length and terms of your due diligence period can significantly impact your offer's competitiveness.

North Carolina uses a unique due diligence system where buyers pay a non-refundable due diligence fee for the right to conduct inspections and finalize financing within a specified timeframe. During this period, you can terminate the contract for any reason and receive your earnest money back, but forfeit the due diligence fee.

Due diligence fees typically range from $500-2,000+ depending on the home's price and market conditions. The due diligence period usually ranges from 7-21 days. In competitive markets, shorter periods with higher fees make offers more attractive to sellers.

Your agent will help you submit your highest and best offer, considering price, terms, closing timeline, and contingencies. Sellers typically choose based on the overall attractiveness of the offer, not just the highest price. Quick closings and fewer contingencies can make lower-priced offers more appealing.

A general home inspection is essential, covering structural, electrical, plumbing, and HVAC systems. Consider additional inspections for termites (common in NC), radon, septic systems (if applicable), well water testing, and specialized inspections for older homes or specific concerns identified during the general inspection.

General inspections typically cost $400-800 depending on home size and age. Specialized inspections (termite, radon, etc.) cost $100-400 each. While inspections add to your upfront costs, they can save thousands by identifying major issues before purchase.

The lender orders an appraisal to ensure the home's value supports the loan amount. A licensed appraiser will inspect the property and compare it to recent sales of similar homes in the area. The appraisal typically takes 1-2 weeks and costs $400-600, usually paid by the buyer.

If the appraisal comes in low, you have several options: negotiate a price reduction with the seller, make up the difference in cash, or terminate the contract if you have an appraisal contingency. In competitive markets, some buyers waive appraisal contingencies but should be prepared to cover any gap.

Title insurance protects against title defects, liens, or ownership disputes. North Carolina is an attorney closing state, so an attorney will conduct a title search. While not legally required, title insurance is highly recommended and often required by lenders. Owner's title insurance typically costs $500-1,500.

Key documents include the promissory note, deed of trust/mortgage, closing disclosure, deed, and various disclosures and affidavits. Review the closing disclosure at least three days before closing to ensure accuracy. Don't hesitate to ask questions about any document you don't understand.

Change locks, set up utilities, update your address with banks and employers, and schedule any needed repairs. Register to vote in your new precinct, find local services like grocery stores and healthcare providers, and introduce yourself to neighbors. Consider getting a home warranty for additional protection.

Standard homeowners insurance covers dwelling, personal property, liability, and additional living expenses. North Carolina is prone to severe weather, so ensure adequate coverage for wind and hail damage. Flood insurance requires a separate policy and may be required in certain areas.

Look for agents with strong local market knowledge, good communication skills, and a track record of recent transactions in your price range and preferred areas. Interview multiple agents, check references and reviews, and ensure they're full-time professionals committed to your success.

Ask about their experience in your target neighborhoods, average days on market for their listings, their marketing strategy, communication style, and fee structure. Inquire about their availability, team support, and how they handle multiple offer situations.

While not required for purchase, North Carolina law requires attorney involvement in closings. Many buyers choose to have their own attorney review contracts and represent their interests throughout the process. This is especially important for complex transactions or if issues arise.

Ask your real estate agent for referrals, but also get recommendations from friends, family, and coworkers who've recently purchased homes. Check online reviews, verify licenses, and interview multiple professionals to find the best fit for your needs and budget.

Raleigh is surrounded by a broad range of cities and towns, in all sizes. Cary and Apex are large suburbs. Cary has a current population of about 188,000 residents, and Apex is home to about 77,000 people, so they are very large towns with a lot to offer.

If you’re looking for a small town atmosphere near Raleigh, consider Fuquay-Varina, Smithfield, Clayton, Lillington, Holly Springs, Zebulon, Selma, Angier, and Garner. These towns have their own unique character, with a downtown district, good schools, and amenities. These smaller cities and towns tend to be more affordable than the larger locales. And you are more likely to find a home with a large yard.

Base your choice of whether to buy a resale or new construction home on the total cost of ownership, not just the purchase price. Consider how much it will cost to both purchase and maintain the home. Look at necessary repairs, remodeling, and replacement costs. A new construction home is covered by a warranty. In addition, everything is new and won’t require updates.

A flipped home refers to a property where the owner purchased the home with the intent of renovating and reselling it, not to be used as their primary residence. In these cases, you should look carefully at the quality of the renovations, ensuring that they were done well, not just quickly. Ask specifically what features were changed with the flip. Also, plan to have the home inspected by a professional who can determine the structural integrity of the home. A flipped home can give you modern updates, but it’s still a resale, not new construction. Wiring, plumbing, and what’s under, behind, and above the walls is still likely to be original to the home.

You do not need a construction loan if you’re building a home in a community where the developer includes the lot with the construction. This type of “to be built” home is funded with a mortgage.

A construction loan is required when you plan to build a home on your own land. This type of loan typically requires that you pay the interest during the construction phase. Then, the loan either converts to a mortgage when the home is completed or you will need to close on the mortgage separately.

If major issues are discovered, you have several options: negotiate for repairs or credits, request a price reduction, or terminate the contract (if still within the due diligence period). Major issues might include foundation problems, roof replacement needs, or significant electrical/plumbing updates.

Some changes can be accommodated, depending on the timing. A structural change, for example, can’t be done after the home is framed. Finish details, like flooring and countertops, might require an additional cost, because the builder usually purchases materials once the purchase and sale agreement is signed. Also, ask the builder if your changes would cause a delay, since some materials and appliances can be harder to get.

Unless you’re working with a custom builder, you probably can’t provide your own floor plan, but ask the builder to confirm. Production builders have a portfolio of plans that they have built, with a range of options for customizing. They know the plans are accurate, which can save you a lot of time, money, and frustration. If the builder is using your floor plan and there are errors, the responsibility for the cost of fixing them falls on you.

North Carolina Housing Finance Agency offers the NC Home Advantage Mortgage with down payment assistance up to $15,000. The USDA Rural Development program serves some outer Raleigh areas. VA loans are available for veterans, and FHA loans require just 3.5% down with flexible credit requirements. See here to learn more!

Common home mortgage options include conventional loans (fixed or adjustable rates), FHA loans (government-backed with lower down payments), VA home loans (for veterans), USDA loans (for rural areas), and jumbo loans (for homes priced $766,550 or above in Wake County). Each home loan program has its own requirements and benefits. Shop around and talk to different lenders to explore your options and determine the right fit for your financial situation.

From application to closing typically takes 30-45 days. The process can be faster with local lenders who understand North Carolina requirements. Factors affecting timeline include loan type, property type, appraisal scheduling, and any issues that arise during underwriting.

Mortgage rates fluctuate daily based on economic conditions. Rates vary by loan type, down payment, credit score, and lender. Local banks and credit unions often offer competitive rates for area residents. It's wise to shop with multiple lenders to compare offers.

North Carolina requires attorney closings, providing legal protection for both parties. The closing attorney will explain all documents, handle fund transfers, and ensure proper recording of the deed. Bring a certified check for closing costs and your portion of the down payment, plus valid photo ID. Click here to read more!

Consider refinancing when interest rates drop significantly below your current rate, when your credit score improves substantially, or when you want to remove PMI after reaching 20% equity. Refinancing typically makes sense if you can lower your rate by at least 0.5-1% and plan to stay in the home long enough to recoup closing costs.

Real estate commissions are typically paid by the seller and range from 5-6% of the sale price, split between listing and buyer's agents. As a buyer, you typically don't pay your agent's commission directly, but you will pay for inspections, appraisal, and other services you choose to use.

The Federal Reserve recently lowered interest rates, bringing mortgage rates to their lowest point of 2025. For homebuyers, this means:

• Lower monthly mortgage payments

• Increased affordability for first-time buyers

• More purchasing power when choosing a new home

On top of that, North Carolina homes are priced about 20% below the national average, giving buyers in Raleigh a unique affordability advantage.

Want to learn more? Read our full blog: Mortgage Rates are at 2025 Lows: Why Now is the Time to Buy in North Carolina.

Closing costs in North Carolina typically range from 2% to 5% of the purchase price. For a $450,000 home, that could be $9,000 to $22,500. Talk to your real estate agent and lender for a more accurate estimate of closing costs in the specific area where you plan to buy a home in Raleigh or the surrounding areas.

Before you begin shopping for new homes for sale in Raleigh, learn how much you can realistically qualify to borrow. The process is called “mortgage pre-approval”. Always get pre-approved, not just pre-qualified. Neither the pre-approval nor the pre-qualification is a guarantee of a loan, but the pre-approval is more reliable.

Mortgage pre-approval is a simple step. It involves a lender’s review of your financial situation, including income, bank accounts, debt, and job security (e.g., how long you’ve been at your current and previous jobs). After this review, you’ll receive a conditional commitment (in the form of a letter) for a specific loan amount. In Raleigh's competitive market, sellers strongly prefer pre-approved buyers and may not consider offers without pre-approval letters.

To be pre-approved for a mortgage, you’ll need to provide a lender with the following information and documentation:

●      Photo identification

●      Social security number

●      Employment information

●      Income tax returns for the past two years

●      W-2 forms from the past two years

●      Bank account information

●      Investment account statements

●      List of monthly debts

Within a day or two, you should hear from the lender. If you are not pre-approved for a mortgage, ask what’s blocking your way. There might be some quick fixes you can do. Feel free to also contact other lenders, since they don’t all follow the same decision-making criteria.

Some builders and Realtors have great experience with particular lenders. Based on the success of those relationships, they might suggest one that they call a “preferred lender”. In addition to the confidence you gain, you might benefit from other advantages, such as a smooth closing and discounts. A preferred lender might offer such incentives as paying for some of the closing costs or a rate buydown. By law, a lender cannot receive compensation from the builder or sales agent, so there’s no conflict of interest there.

You are never required to use the preferred lender, but it’s worth finding out whether the relationship is to your advantage.

The short answer is, “Don’t give up.” Every lender follows their own criteria for determining whether or not a customer is suitable for a home loan. Approximately 20% of mortgage applications are rejected each year.

Your first step is to ask the lender the reason for the denial. They are required to provide their reasons in a letter. Once you know the reason behind the loan denial, you can determine your next steps. If you’ve been turned down for a conventional loan, you might qualify for a government-backed loan, like the FHA home loan.

Talk to other lenders and ask them about your possibility of being approved according to their requirements. However, every loan application comes at a cost to your credit score. If your score is already borderline for loan approval, every attempt will knock down your score temporarily.

Locking in your mortgage rate means you have a guarantee of getting that interest rate when you close on the purchase of the home. Ordinarily, you confirm the rate when you apply for a loan. Some lenders charge a fee for a rate lock, so ask before you act.

Rates change frequently, and you might be tempted to wait before locking it in. But such speculation is risky. When you find a rate that you can afford, secure it.

A “float-down” option might be available. You pay for the opportunity to unlock your rate and take a lower one—good for one time only.

When interviewing potential lenders, be clear on when you can lock in a rate, for how long, and at what cost.

A rate buydown provides a lower rate, either temporarily or through the entire term of your loan. You buy “discount points”, with each one priced at the equivalent of 1% of your loan amount. For example, if you’re financing $400,000, each discount point would cost $4,000.

The point lowers your rate by 0.25%. That might not seem like a lot, but when you look at the impact on your monthly payment, you might be surprised at the long-term savings.

Some builders and lenders offer to cover the cost of a rate buydown, saving you even more! At New Home Inc., we are glad to discuss the option of paying for the rate buydown for our homebuyers.

Many newer Raleigh neighborhoods have Homeowners Associations with fees ranging from $50-$300+ monthly. Review HOA documents carefully for rules about renovations, rentals, pets, and parking. Understand what amenities and services are included, and check the HOA's financial health.

In a growing market like Raleigh, location is crucial for long-term value. Proximity to major employers, good schools, transportation corridors, and amenities typically matters more than specific house features, which can often be modified. Focus on neighborhoods with strong fundamentals and growth potential.

Wake County reassesses property values every four years, with annual updates for new construction and improvements. Property taxes are due September 1st each year, with a 5% penalty after January 6th. Many homeowners escrow taxes through their mortgage payment. Contact the Wake County Tax Office for specific information about your property.

A great neighborhood for families provides convenient access to schools and amenities (e.g., playgrounds, recreation, family-friendly things to do), safety, and other families with children of the same age. Parents also need to consider the commute to work and affordability. The potential growth of the area is also important to note, because it impacts your home’s resale value, as well as could present either a positive or negative view for the way you want to live.

Neighborhood Scout offers helpful profiles of cities and towns,  including demographics, housing costs, schools, real estate market, and safety.

You have a few good tools for researching the quality of a school and district in North Carolina. Start with GreatSchools.org. Then dive into the NC Department of Public Instruction website, where you’ll find data on a wide range of academic criteria that are important to families. Consider both elementary and high school options, as well as magnet and charter school opportunities. Learn about school choice programs that may provide additional options beyond your neighborhood school. 

Regular maintenance includes HVAC filter changes, gutter cleaning, caulk inspection, and seasonal preparation. The humid climate requires attention to moisture control and ventilation. Schedule annual HVAC service, test smoke/carbon monoxide detectors regularly, and keep trees trimmed away from the house.